Liberal critic has more questions on yellowtail

James McLeod
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Liberal fisheries critic Jim Bennett

Liberal fisheries critic Jim Bennett is already back to work after the holidays, taking the government to task for not squeezing as much value as possible from yellowtail flounder.

Bennett pointed to places where yellowtail is selling for around $10 per pound for fillets in the U.S.

“I think the biggest challenge for me as a fisheries critic is to bring enough contemporary and accurate market information regarding fish so that the people on the street know exactly what’s happening and how we’re being disadvantaged,” he said.

“Canada is one of the best nations on Earth surrounded by three oceans and the U.S. economy to the south, and we can’t figure out how to take a fish out of the water and sell it to the Americans without sending it to China? To me, this is almost like a farce.”

Ocean Choice International has announced that it will be closing its Marystown fish plant because it has lost $10 million handling yellowtail at the facility in the past three years.

The company is looking for an exemption from the provincial government to ship out most of the yellowtail quota with a plan to process the rest at a smaller plant in Fortune.

Bennett argued that whether or not to grant the exemption is not the most appropriate question.

“The more appropriate question is what is this resource worth, and who owns it,” he said.

“If they say that they can’t process it in Marystown at a profit, then maybe they shouldn’t process it at all.”

He pointed to a website where small fillets sell for $9.95 per pound as evidence of the market value of flounder.

But Martin Sullivan, president of OCI, said that it’s not possible to look at one small segment of the market and assume that the entire quota can be sold at that price.

“It’s easy to pick small pieces of information and blow it up without looking at the full story,” Sullivan said. “You have to look at the whole mix that you produce and what the economic return on that is.”

He argued that the company has been losing money on the yellowtail operation for years, and has been pursuing markets for the product more aggressively than anyone else ever has. If it were possible to make a go of it, he said, they wouldn’t be in this position.

Instead, Sullivan argued that the main growing market for the product is Asia, where consumers want whole fish.

“We have to respond to what the market wants,” he said. “The growth markets of the world, like Asia, demand seafood in a different form than we’re used to and pay good money for it.”

Bennett said that under the terms of an agreement that gave the yellowtail quota to OCI in 2007, the province should be able to get it back if the company isn’t landing the fish in Marystown.

However, in an e-mailed statement, Fisheries Minister Darin King said that’s not an option.

“In consultation with the FFAW and the Department of Justice, government is satisfied that OCI has lived up to their side of the FPI Implementation Agreement,” he said.

King was interested in the possibility of U.S. marketing though, although he was cautious about it.

“In respect to fish selling at $9.95/lb in the U.S.: there are always small markets for certain types of fish throughout the world,” King said.

“We are glad this was brought to our attention. Government is doing its own research around the markets and will take this into consideration before a decision is made. The current claim by the opposition regarding $9.95/lb in the US is taken at face value until such time as it is confirmed and evaluated. Government will look into it. However, we express caution that just because one website is selling it at this price does not necessarily represent the entire market. There are always specialty markets."

Twitter: TelegramJames

Organizations: OCI, Department of Justice

Geographic location: U.S., Marystown, Canada China Asia

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Recent comments

  • Jerry Lavers
    December 31, 2011 - 17:11

    As I understand it OCI has a "Processing" liscence. If we are going to sell whole fish to China then why can't the provincial government can contract the harvesting, sell the fish to China themselves take the profits and invest in economic development in areas affected by OCI's closures. Better still call for proposals for some other processor to catch and process the product in Newfoundland and Labrador.

  • fintip
    December 31, 2011 - 00:38

    Arguably the saddest aspect of Newfoundland's entry to confederation (and clearly there are many) is the transfer of control of our fisheries resource to Ottawa. The pattern of marginalization, degradation, and alienation of the resource that followed is variously put down to indifference, incompetence or sabotage. Whether it is one or all of the above, there can be no doubt that Ottawa's administration of the fishery rises to the level of negligence - many would say gross negligence. The province's ability to influence the direction of fisheries development, or to mitigate the damage wrought by Ottawa, has been limited to the management of the resource on land - specifically the processing and extra-provincial transportation of fish. It is akin to changing the trajectory of an iceberg with a dory. Even an inordinately great effort is likely to yield miniscule results. In the face of that futility, the province has at times all but given up even trying. This was especially true during periods in which it was preoccupied with other engines of economic growth. We are in just such a circumstance at present. With visions of mega projects dancing in its head, the province is about to relinquish the little leverage it still exerts in this industry. Having become increasingly impatient and even irritable with those advocating a tough stance, it is inclined to roll over and allow companies like OCI to have its way with it. Mr. King's deferral of a decision on yellow tail is prompted less by an instinct to do what is right and more by a desire to gauge the degree of public backlash when it inevitably accedes to OCI's demands. Which is unfortunate, in part because there is a principle involved, but even more because to do so is to unleash a cascade of like demands that will ultimately see little if any value added processing in this province. Beyond that, any attachment to this industry retained by Newfoundland will be more a matter of convenience than compulsion. Ownership of quotas will be determined by Ottawa bureaucrats, lobbyists and whichever Canadian or non-Canadian company has the biggest wad of cash. The Rock will become little more than a service station and refuge from bad weather for ships leased by no-name, foreign-based multinationals. King's nod of approval to OCI next month won't be the start of the slippery slope - it will be the thud of a once mighty industry hitting the bottom.

  • Eli
    December 30, 2011 - 12:03

    Where is that Yellowtail that sells for $10.00 a pound in the U.S. processed? Then do the obvious math.

  • Cyril Rogers
    December 30, 2011 - 11:18

    This government sees only one way to do anything: give it all over to their large corporate sectors buddies and ignore the small towns and smaller producers. It is purely propaganda that every industry is best served by large corporate producers and, they can get away with it, since most people don't care about the fishery anymore unless their livlihood is tied to it. Small town plants and smaller producers will not have a chance under this kind of approach. It does not have to be all or nothing but that is what this government seems to believe or wants us to think. They like their megaprojects and megadeals even when there are better alternatives. This resource belongs to the people of this province but we are handing it over to the corporate sector. For what? Now, they can't do anything about it? Didn't they expropriate Abitibi in Grand Falls a few years ago? Or, does OCI own them?

  • Robert
    December 30, 2011 - 09:44

    King's view on the fishery seems to be inconsistent with his government's view on Muskrat Falls. On one hand, the province is determined to ram through a $6 billion spend of public money knowing that there is absolutely no market for the product other than the small market at home and that any profits made will be from taxing the energy usage of its own citizens. On the other hand, in the case of yellow tail flounder, the same government is unwilling to spend any public money and is exercising extreme caution and hesitation in setting conditions on licensing despite indications that a profitable market exists. Both energy and fish protein are renewable resources, why the contradictory attitudes?

  • Greg
    December 30, 2011 - 08:21

    The problem we got with the N&L fishery, We got to many plant's. FFAW is not concern about the worker,but the union due's. Mr King and Mr Bennett, those two plant will be close. What you two men should be working on, is a way to put those displace worker, back to work in a productive way, before they all pack there bag's, and head for the mainland.

  • bob
    December 30, 2011 - 07:43

    Sure i bought a flounder for $6 on a wharf last summer. Should i assume that the company would only get around $2 a pound for it if they sold it because i bought it at a similiar price in one spot. Not sure who is doing Bennetts research for him, whether its himself or the party? But to get any credibility, do the full research before you put out a press release. Nobody likes to see a plant or any company door close but its the sign of the times. We have to adjust or more towns will be in trouble.

  • Maurice E. Adams
    December 30, 2011 - 07:12

    Recently read an article on the forest industry (nationally, I think it was) where it was made clear that the strategic focus for the coming decades was as follows: sustainability, maximizing social and cultural benefits of the resource to adjacent communities, and then economics. Seems to me that selling our fish unprocessed to China is an example of the opposite of what other resource sectors are doing. We are putting the cast before the horse by focusing (almost exclusively) on the 'economics'. The OCI industrial/cash crop approach to the fishery is focusing first and foremost on economics, while doing little or nothing for maximizing the benefit to our coastal communities --- and certainly, the factory freezer, industrial drive for quick profit is not a sustainable, ecosystem based approach to our most valuable renewable resource.